There are about 11.4 million semi trucks, also referred to as tractor trailers, that are constantly running in the United States. Over 75 percent of these trucks are diesel powered.
Diesel has a larger influence on the economy than many think. Factors like the price of diesel are largely responsible for the price of the items that consumers buy in their daily lives, this is because all of our items arrive in a diesel powered semi truck. California is continuing to tighten down restrictions on diesel, planning to eventually eradicate them. This will cause chaos and result in substantially more inflation.
California has been known for maintaining fuel prices that are on average about 110 percent higher than the national average. This is due to a multitude of reasons, number one being that the residents of California do pay more fuel tax compared to other states. The largest reason is because California fuels are different than the fuels used in any other states. California has continued to tighten down its emission laws, making stricter regulations regarding the Clean Air Act.
Due to the Clean Air Act, the fuels that are brought into California have been modified in an attempt to reduce emissions. These fuels are also blended with biofuels. This currently causes the price of diesel to raise by eight to ten cents per gallon, but, California aims to tighten down regulations to the point where the fuel is raised by about two dollars per gallon by the year 2030.
With all of these policies set in place, it causes a chain reaction. Truckers now have substantially higher fuel cost, meaning that they have to compensate for this. The reality is that someone will end up paying for this, and that would be the consumers. With truckers being responsible for moving just about everything, their raised fuel cost results in raised costs of products for consumers, essentially, inflation. This inflation will continue to get worse over the years.
“I think that the implementation of diesel and its increasing cost says something about California, the extra cost impacts not only diesel but the trucks and drivers that travel the United States. This extra cost may be for cleaner air, but semi-trucks and other diesel vehicles that need this fuel are still driving and are going to burn and buy fuel. This extra cost is going to impact more than just cleaner air but transportation as well” stated senior Samuel Torres.
Along with the prices of fuel continuing to rise, with California’s goal to eradicate diesel trucks in the state, this will require trucking companies to get rid of entire fleets and then have to invest in brand new fleets of electric trucks, as well as chargers. While there may be no diesel costs for these electric trucks, there is still the initial purchase price that comes into play. The initial purchase price for an electric truck is double the cost of a diesel truck, this will cause a severe rise in inflation, as trucking companies will have to compensate for this extra cost.
This policy will also eradicate any small trucking companies who only have fleets with a few trucks in them. These companies will not be able to afford to purchase such expensive trucks, and they will be forced to shut down. This would leave only the larger companies who are looking to purchase thousands of these trucks, government incentives are sure to be present in such large purchases. For example, Pepsi has purchased 21 of Tesla’s brand new semi trucks. 18 of the 21 trucks were paid for by the Sacramento Metropolitan Air Quality Management District with $4.5 million in grants.
These changes will not only cause severe inflation, but will also end jobs. The EPA, otherwise known as the “Environmental Protection Agency” sets these restrictions in place for the entirety of the United States, but California has been known for using stricter regulations. As the first in the nation, California has mandated that all brand new trucks produced in the year 2036 or after are required to be electric. California also requires that all existing fleets of diesel trucks be replaced with electric trucks by the year 2042. This policy will drive inflation to new heights as it forces trucking companies to invest in trucks that cost double the amount of their existing fleet.
“California should focus on reducing air pollution elsewhere due to how devastating inflation could become of diesel prices and electric truck prices continuing to rise” stated Junior William Schoch.
